{"id":465,"date":"2010-04-07T14:02:00","date_gmt":"2010-04-07T19:02:00","guid":{"rendered":"http:\/\/itn.mattrock.ca\/2010\/04\/07\/oil-transport-company-tidewater-inc-initiates-icsid-arbitration-against-venezuela-over-expropriated-assets\/"},"modified":"2013-01-23T08:18:36","modified_gmt":"2013-01-23T14:18:36","slug":"oil-transport-company-tidewater-inc-initiates-icsid-arbitration-against-venezuela-over-expropriated-assets","status":"publish","type":"post","link":"https:\/\/www.iisd.org\/itn\/2010\/04\/07\/oil-transport-company-tidewater-inc-initiates-icsid-arbitration-against-venezuela-over-expropriated-assets\/","title":{"rendered":"Oil transport company Tidewater Inc. initiates ICSID arbitration against Venezuela over expropriated assets"},"content":{"rendered":"

By Fernando Cabrera Diaz<\/span><\/strong><\/p>\n

April 8, 2010<\/span><\/strong><\/p>\n

New Orleans-based Tidewater Inc. has initiated arbitration against Venezuela at ICSID<\/span> over the latter\u2019s alleged take-over of 15 of the company\u2019s vessels in May and July of 2009. According to the company these and other seizures of the company\u2019s assets amount to expropriations in violation of Venezuela\u2019s bilateral investment treaty obligations and Venezuela\u2019s investment law.<\/span><\/p>\n

Tidewater Inc. provides transportation services to petroleum companies, principally for offshore operations. In Venezuela the company was providing support to national oil company Petr\u00f3leos de Venezuela, S.A. (PDVSA).<\/span><\/p>\n

According to a February 17, 2010 regulatory filing with the U.S. Securities Exchange Commission (SEC), Tidewater claims that in May and July of 2009 PDVSA took possession and control of fifteen of the company\u2019s vessels, most of which were in support of PDVSA\u2019s operations in the Lake Maracaibo region of Venezuela.<\/span><\/p>\n

During the same period Tidewater says PDVSA took over its operations in Lake Maracaibo and the Gulf of Paria, as well as other assets.<\/span><\/p>\n

Before filing its claim, which it did on February 16, 2010, the company sent Venezuela a notice of dispute and requested consultations but it did not receive a response.<\/span><\/p>\n

ITN<\/span> contacted Oscar Garibaldi, of Washington DC-based Covington Burlington LLP, who represents Tidewater.<\/span><\/p>\n

\u00a0Given that there is not bilateral investment treaty between Venezuela and the U.S., Mr. Garibaldi explained that two of the claimants are protected under the Barbados-Venezuela bilateral investment treaty, while \u201c[a]ll of the claimants invoke ICSID jurisdiction under Art. 22 of the Venezuelan Investment Law and assert claims based on Venezuelan law and customary international law.\u201d <\/span><\/p>\n

He indicated those investors covered under the BIT<\/span> accuse Venezuela of: (i) breaching the standard of fair and equitable treatment; (ii) breaching the obligation not to impair by arbitrary or discriminatory measures the operation, management, maintenance, use, enjoyment or disposal of the treaty claimants\u2019 investments; (iii) failing to accord treatment no less favorable than that accorded to nationals or companies of Venezuela or a third State; and (iv) expropriating Tidewater\u2019s the investments without observing the obligations imposed by the Treaty.<\/span><\/p>\n

Tidewater has yet to quantify the amount of damages it seeks, but will do so at a later stage of the proceedings.<\/span><\/p>\n

Though Venezuela has in the past made offers to provide some compensation to foreign companies for taken assets, Mr. Garibaldi says that no such offers have been made to Tidewater.<\/span><\/p>\n

Sources:<\/span><\/p>\n

Tidewater Inc. February 17, 2010 filing to the SEC: <\/span>http:\/\/ccbn.10kwizard.com\/xml\/download.php?repo=tenk&ipage=6770887&format=RTF<\/span><\/a><\/p>\n